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updated: 4/2/2014 7:38 PM

West Dundee eyes new taxes, fees to make up for Target loss

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  • West Dundee leaders are responding to Target's closure by looking at several new ways to generate new revenue for the village through taxes and fees. The closure is to blame for the village's roughly $300,000 deficit in the new budget.

       West Dundee leaders are responding to Target's closure by looking at several new ways to generate new revenue for the village through taxes and fees. The closure is to blame for the village's roughly $300,000 deficit in the new budget.
    Christopher Hankins | Staff Photographer

 
 

West Dundee trustees will discuss a combination of ways to plug an estimated $300,000 budget deficit as they plan for life without Target, one of the village's largest generators of sales tax.

Those options include imposing a 1 percent tax on food and beverages, a 2-cents per gallon gasoline tax and charging residents for refuse collection services.

Board members got a first look at those ideas this week and will discuss them in depth Monday.

"There is a deficit that needs to be addressed and that will be the focus of our next workshop," Village President Chris Nelson said.

Officials estimate that the food and beverage tax, which would apply to alcohol and restaurant cuisine, would generate between $250,000 and $275,000 a year for the village, according to a memo from village management.

Between the four gas stations in the village, West Dundee could generate about $200,000 a year with the gas tax, according to the memo. The tax would apply to gasoline, compressed natural gas and diesel fuel.

West Dundee would have to administer and collect the new taxes, which would require additional staff, processes and procedures in the finance department, the memo noted.

As for the refuse collection services, the village could include the charge as a bimonthly fee on the water and sewer bill.

The service is expected to cost the village $580,000 in the next fiscal year, and because residents aren't used to paying for the service, they might have a tough time adjusting to the fee, the memo said.

Moreover, the fee would be exclusive to certain people, as it would not apply to the commercial areas or to residences with more than three units.

These ideas are in addition to suggestions to move $85,000 from two funds to the general fund and to use $70,000 in interest to offset operating insurance costs.

After Monday's initial workshop, the board will discuss the options again April 14 at a second workshop.

Trustees are expected to adopt the budget at the end of April.

In January, Target announced it was closing after nearly 20 years for financial reasons.

The next fiscal year begins May 1. Target is scheduled to close two days later.

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